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Background
The Company owns and operates a diverse range of businesses in different countries and cultures around the world that, by their nature, may affect the community. We track a range of social issues relevant to sustainable development, including:
- human rights of our employees and contractors, our suppliers and the communities in which we operate, incorporating such issues as freedom of association, the exclusion of child labour and the prohibition of forced labour
- community development, which incorporates positive impacts, such as increased economic opportunities through employment, training and business spin-offs, as well as potential negative impacts, such as resettlement, impacts on food and water supplies, and loss of cultural sites or values
- indigenous communities that own the land impacted by our operations or live nearby. (We respect the rights of indigenous peoples to retain their culture, identity, customs and traditions and acknowledge the importance of their cultural heritage.)
- ethics and business conduct incorporating issues related to conducting business internationally and interacting with governments, communities and business partners, as well as workplace behaviour, equal employment opportunity, conflict of interest, financial inducements and bribery, insider trading and political contributions (see also HSEC Governance)
- indirect social impacts incorporating such issues as community dependency on our activities, our ability to attract further investment into the area and the location of our suppliers.
The following section discusses our community performance in 2002/03 and highlights some of the key initiatives and subsequent outcomes.
Community performance
Key initiatives
During the period, we adopted the World Bank Guidelines on Involuntary Resettlement and the US-UK Voluntary Principles on Security and Human Rights, so that our policies and systems are in line with the International Council on Mining and Metal's Sustainable Development Framework and key stakeholder expectations.
The Guidelines on Involuntary Resettlement will not be applied retrospectively and will only apply to new resettlement issues. The commitments under the US-UK Voluntary Principles on Security and Human Rights will require some initial actions, followed by progressive implementation as current systems are reviewed. The HSEC Management Standards will be amended during the next formal review to reflect these requirements.
We have also prepared a new internal tool for our operations, to assist them in appraising their potential exposure to human rights issues.
A new employee Matched Giving Program was piloted in South Africa, the United Kingdom and Australia. The program aims to strengthen local communities by supporting and encouraging employees who volunteer, fundraise or donate to not-for-profit organisations.
The pilot Matched Giving Program was well received, with over US$300 000 being contributed to 274 not-for-profit organisations. For example, more than 36 000 hours in personal volunteering were matched with cash donations to organisations where the employees offered their time. A second stage of the pilot will continue next year to further test application of the model in different cultures and operational sites.
In January 2003, BHP Billiton and Oxfam Community Aid Abroad ran the second Corporate Community Leadership Program in Orissa, India. Aiming to increase understanding of social issues relating to our operations, the program involved 12 employees from across the Company. Over a two-week period, participants were exposed to various development projects and the impact they have had on local communities (see Case Study No. 24).
Employee relations
Employee relations at BHP Billiton are the responsibility of local and business unit management. Each business is required to:
- put in place employment arrangements that deliver outcomes consistent with the BHP Billiton Charter, HSEC Policy and Guide to Business Conduct
- build open and productive relationships with employees and provide processes to assist in equitably addressing workplace issues
- ensure that employees have the opportunity to develop skills that allow them to contribute to business success and be recognised and rewarded for those results
- support fundamental human rights and freedom of association and ensure legal requirements governing employment are fully met (consistent with the United Nations Universal Declaration of Human Rights and the United Nations Global Compact).
Employee relations arrangements at individual workplaces are required to respect local legislative requirements and other local standards and circumstances.
Employee profile
During the year, the average number of permanent employees across the Company
(including BHP Billiton's owned and operated facilities, as well as our share
of unincorporated joint ventures) was 34 800, compared to 51 000 reported
in the previous period. A breakdown of employee numbers by region is presented
in Figure 35. The demerger of BHP Steel accounted for a reduction in employees
of 12 270, with the sale of transport and logistics businesses accounting
for another 1380. About 98 per cent of employees at operated sites and corporate
offices work full-time. The average turnover rate of employees at operated
sites and corporate offices was 5 per cent.
A total of about 32 000 contractors were employed at operated sites.
Figure 35.
Regional Geographic Breakdown of Total Number of Employees
2002/03
Freedom of association
While fully recognising the right of our employees to freely associate and
join trade unions, we have a number of locations where we have a mix of collective
and individual arrangements. Prospective employees are made aware of employment
arrangements prior to joining the Company. The Company has a policy to consult
with employees on major organisational changes.
Figure 36 presents a breakdown of the reported percentage of employees at operated sites and offices in each region who are covered by collective bargaining agreements.
Figure 36.
Reported Percentage of Employees Covered by Collective
Bargaining Agreements by Region
2002/03
Diversity
The Company is committed to developing a diverse workforce and to providing
a work environment in which everyone is treated fairly and with respect and
has the opportunity to contribute to business success and realise their potential.
In real terms, this means harnessing the unique skills, experience and perspectives
that each individual brings and recognising that these differences are important
to our success. Harassment in any form is unacceptable.
Employment with the Company is offered and provided on the basis of merit. All employees and applicants for employment are treated and evaluated according to their job-related skills, qualifications, abilities and aptitudes only. Employment decisions based on attributes other than a person's qualification to perform a job are prohibited - e.g., race, colour, gender, religion, personal associations, national origin, age, disability, political beliefs, HIV status, marital status, pregnancy, sexual orientation, or family responsibilities. Further information on our Employment Principles is available on our website at www.bhpbilliton.com/bb/peopleAndEmployment/employmentPrinciples.jsp
The Company has identified some specific sites and countries where diversity issues are particularly sensitive. Examples of ongoing policies or programs undertaken to address employment diversity issues include the Employment Equity Policy in South Africa, which ultimately aims to achieve representation at all levels in our businesses consistent with the demographic profile of South Africa (see Case Study No. 37), and targeted indigenous employment programs in the Pilbara region of Australia (Iron Ore), the Northwest Territories in Canada (EKATI), and New Mexico in the United States (New Mexico Coal).
Of the Company's most senior 670 managers, 35 are female. In the year ending 30 June 2003, about 8 per cent of full-time employees at operated sites and offices were women. There were significant regional differences, with women representing about 50 per cent, 20 per cent and 12 per cent of full-time employees in Europe, North America and Australia respectively. In addition, most of the 950 part-time employees were women. There are no female members of the Board currently; however, the current Company Secretary is a woman.
Child labour
We continue to monitor Company practices in relation to the exclusion of child labour. All sites report the age of their youngest worker and the corresponding minimum working age in their jurisdiction. In the past year, the youngest employees were 17 years of age, working as apprentices in our Australian operations.
Remuneration
All Company employees earned greater than the stipulated minimum wage in the
countries in which they worked.
Human rights
During the year, a Human Rights Self-Assessment Toolkit was developed and distributed to all Company sites to assist them in appraising their potential exposure to human rights issues. Development of the Toolkit is consistent with the Company's target to ensure there are no transgressions of the principles contained in the United Nations Universal Declaration of Human Rights.
The Toolkit enables sites to assess their level of impact on or exposure to human rights, encompassing child labour and forced labour, in nine aspects relevant to our operations: country, community, land acquisition, indigenous and minority groups, environment, security, employees, contractors and suppliers, and systems. The self-assessment will form part of the HSEC audit process.
Three sites reported human rights issues during the year. At the Tintaya copper mine in Peru, pending issues are being addressed by the ‘Mesa de Diálogo’, a dialogue process established with representation from the five communities in the Espinar region (see Case Study No. 34).
Two issues in South Africa are currently being resolved. One relates to squatters dwelling on a mine property and the other to the voluntary relocation of a person living in a house on a closed mine site.
Indigenous employment and training
Indigenous employment is an important issue at a number of our sites. Some sites have set specific targets for indigenous employment and are publicly reporting their progress against these targets, while at other sites, various initiatives are being introduced to increase and maintain indigenous employment levels.
For example, since the launch in 2000 of BHP Billiton Iron Ore's five-year ‘Investment in Aboriginal Relations’ strategy, direct indigenous employment has grown from an estimated 3 per cent to a verifiable minimum of 5 per cent, with 55 indigenous persons placed in formal traineeship programs in a range of areas. A variety of educational and workplace support programs have also been put in place to provide a platform for continuing growth in indigenous employment.
Indirect (contractor) indigenous employment numbers are still being gathered, but a minimum current requirement of 5 per cent indigenous employment has been introduced for all service, construction and mining contracts as they fall due for renewal at Iron Ore. Though still in the early stages of establishing measurement mechanisms, preliminary assessments of contracts with indigenous employment targets show that employment numbers are currently being met or exceeded. Other specific indigenous contractor initiatives include:
- Western Desert Puntukurnuparna Aboriginal Corporation currently employing eight to ten indigenous persons on the Newman gardening contract
- Ngarda Civil and Mining, a 50 per cent indigenous-owned joint venture earthmoving company, employing 42 indigenous persons at Port Hedland's Finucane Island and Boodarie Iron operations with a further 16 opportunities becoming available in the near future
- Excel Resource Group, a 70 per cent indigenous-owned rigging and general mine services enterprise, currently employing six people to provide services at Nelson Point, with a capacity to expand significantly on that number
- active support in the establishment and operation of Indigenous Mining Services, formed by Area C Native Title claimants as a commercial labour supply enterprise and currently providing indigenous labour for the construction and operation phases of the Area C project.
At Groote Eylandt Mining Company (GEMCO) in the Northern Territory, Australia, 39 full-time employees of the total workforce of 207 are of indigenous descent, a total of 19 per cent. This number includes 21 full-time participants in GEMCO's Aboriginal employment strategy, which combines employment and training with activities undertaken by the Rehabilitation and Mine Services department.
New Mexico Coal in the US has a legal obligation to fill all positions at Navajo Mine with Navajo people if a qualified candidate is available for the job. The business voluntarily practices Native American preference at San Juan Coal Company and New Mexico Coal support services.
Our Native American employment numbers have remained at 64 per cent (of 897 employees) across New Mexico Coal and at 92 per cent (of 328 employees) at Navajo Mine.
Our EKATI Diamond Mine in the Northwest Territories of Canada is progressively moving towards its targets. Currently, 58 per cent of the workforce are from the local area (against a target of 62 per cent), with 28 per cent being Northern Aboriginal (against a target of 31 per cent). In addition, 80 to 100 Aboriginal employees are enrolled at any one time in a Workplace Literacy Program developed by EKATI, which was recognised this year by the Conference Board of Canada with an Excellence in Workplace Literacy Award.
Business conduct
There were 55 substantive calls to the Business Conduct Helpline and Fraud Hotline. A breakdown of these calls is included in Figure 37. The most common issues raised related to fraud, conflict of interest, travel policy, HSEC and confidentiality. Several cases required involvement of the Global Ethics Panel.
Figure 37.
Business Conduct Helpline and Fraud Hotline
Categories of Calls
2002/03
During the year, internal performance requirements for Business Conduct were fully integrated in the HSEC Management Standards. Questions regarding business conduct were included in the HSEC audit and self-assessment, which has helped to quantify the extent to which employees and contractors have been made aware of the Guide to Business Conduct. While a large part of the Company has rolled out the Guide, communication is being improved at some sites and offices. Across all operations, communication about business conduct principles will need to be maintained. There is commitment from the most senior management to ensure the principles of the Guide are understood and practised.
Community relations plans and complaints
All sites are required to report publicly on their HSEC performance. This year 97 per cent of our sites have produced reports, which meets our target. These reports are available on the website at www.bhpbilliton.com/bb/sustainableDevelopment/operationsHSECReports.jsp
Ninety-five per cent of our sites have community relations plans in place or were covered by a regional development plan developed by the business group.
All sites are required to have community complaints registers in place to record and track the management of community concerns. During the year, 57 (or 62 per cent) of our sites received a total of 361 complaints. Of these, 22 per cent were related to dust, 22 per cent to noise, 17 per cent to odour and the remainder to a range of other issues.
Community contributions
Community programs operated at both corporate and site level during the year. The contribution towards community programs totalled US$42 million, comprising cash, in-kind support and management time. This amount equates to 1.4 per cent of pre-tax profit (three-year rolling average), which exceeded our target of 1 per cent. The amount also includes our contribution to community programs at joint venture operations.
We recognise the importance of assisting in the development of healthy communities wherever we operate.
The distribution of our funding by program category and by geographic region is presented in Figures 38 and 39.
Figure 38.Community Contributionsby Program Category 2002/03 |
Figure 39.Community Contributionsby Geographic Region 2002/03 |
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(US$ million)
Education: 12.1
Arts: 1.5
Environment: 2.4
Health: 5.3
Sport and Recreation: 1.2
Community Welfare: 13.1
Other: 6.7
In October 2001, PNG Sustainable Development Program Company was established as a result of an agreement between BHP Billiton and the Papua New Guinea Government, following our withdrawal from Ok Tedi Mining Limited (OTML).
Under the agreement, all of the dividends from OTML that would have gone to BHP Billiton now go to PNG Sustainable Development Program Company, which has the role of distributing profits from the mine to community development projects in Papua New Guinea.
During 2002, PNG Sustainable Development Program Company received one payment from OTML of gross dividends totalling US$7.2 million. Two more dividend payments totalling US$34.3 million were received during 2003 up to April 30. Plans for current and long-term funds for development programs have been established, but there was no expenditure during the period. A sustainable development program strategy is being developed (see Case Study No. 26).
Further examples of our community programs are presented in our Community Programs report, which is available on our website at www.bhpbilliton.com/bb/sustainableDevelopment/community/home.jsp